A testamentary trust is a type of trust that comes into effect upon the occurrence of a person’s death. For example, a parent might set up a testamentary trust to provide for a child in the event of the parent’s death. When the parent passes away, the testamentary trust takes effect and becomes available for providing financial support to the child.
Testamentary trusts will usually be included in a person’s will as a provision to care for a child, spouse, or other loved one.
Testamentary Trust vs. Living Trust
A living trust comes into effect when the person who set it up is still alive, while a testamentary trust does not come into effect until after the person who created it passes away.
Testamentary trusts are generally recommended to individuals who have dependents and want to make sure that their loved ones will have financial stability in the event of their death. If you have children who are minors, you can opt to set up a testamentary trust with a trustee who is responsible for managing the money until the children come of age or reach another appointed milestone, such as completing university.
Setting Up a Testamentary Trust
If you would like to create a testamentary trust, get in touch with Munro & Crawford today. Our lawyers have years of experience helping clients set up trusts to protect their families. We are happy to walk you through the entire process, from creating the trust to choosing a trustee to responsibly manage the funds. We are dedicated to prioritizing our clients’ wellbeing and always work to come up with a plan that is right for you and your beneficiaries.
Write a comment: